COURT DECISIONS

Rough Notes, Sep 2007

The Supreme Court of Virginia agreed with Jones and Lee-Curtis. According to the court, the duties that Jones allegedly violated arose solely out of the agency agreement, which required "due diligence in obtaining accurate information and making all necessary inspections required by [Augusta Mutual]." Thus, Augusta Mutual alleged only breach of contractual obligations, not fraud in the inducement. Augusta Mutual's claim for breach of fiduciary duty failed as well. According to the court, "but for the existence of the agency agreement, neither Jones nor Lee-Curtis would have owed any fiduciary duty to Augusta Mutual." Emphasizing its commitment to "safeguard against turning every breach of contract into an actionable claim for fraud," the court held that there was no separate cause of action for breach of fiduciary duty outside of the contractual obligations.

The lower court's judgment in favor of Jones and Lee-Curtis was affirmed.

Augusta Mutual Insurance Company vs. Mason-No, 061339-Supreme Court of Virginia-June 8, 2007-645 South Eastern Reporter 2d 290.